What accounting assumption, principle, or constraint would Target Corporation use in each of thesituations below?(a) Target was involved in litigation over the last year. This litigation is disclosed in the financialstatements.(b) Target allocates the cost of its depreciable assets over the life...

Jan 15 2012 02:04 PM

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Mark B contributed on Jan 16, 2012 02:39 AM

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(a) Target uses the lower of cost or market basis to value inventories ----- Industry practice (b) Target was involved in litigation over the last year

(a) When target was involved in a litigation over the last year, and the target has disclosed it in its financial statements than the company should find out whether it is a contingent liability or a probable liability

(a)Over the last several days, there has been a raft of SEC filings in which companies have disclosed “reasonably possible” litigation losses. These filings are the result of SEC pressure and an interpretative position advanced by the Staff. In recent speeches, the Chief Accountant of the SEC’s Division of Corporation Finance has questioned whether companies are complying with the existing disclosure standards applicable to litigation contingencies

Match each of the numbered descriptions with the principle or assumption it best reflects. Enter the letter for the appropriate principle or assumption in the blank space next to...

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Solution: The table gives the matching, 1. Revenue is recorded only when the earnings process is complete. G. Revenue recognition principle 2. Information is based on actual costs incurred...